tv Bloomberg Markets Bloomberg May 15, 2015 10:00am-11:01am EDT
about the strength of the u.s. recovery. just few years after america lifted sanctions, hilton hotels is leading the way. i went there to find out more. >> and when a miller lite isn't good enough, when is it good enough? we are looking at the explosion of craft beer here in the u.s. ♪ >> oh. >> good morning i'm oliveya serns, welcome to the blmedblmed. erik: and i'm erik schatzker. that's a disappointing day to michael mckee now. michael: i want to be like you, erik when you see a bad number. the university of michigan
comes in at 88.6. now it was 99.9 last month. and that was forecast that it would be the same. it looks like it's dropped to both in the expectations and current conditions index. current conditions fall to 99.8 from 107. or the next six months, 81.5 from 88.8. something happened to really worry consumers. we'll look at it with the folks from the university of michigan coming up shortly. expectations have picked up 2.9% from 12 months inflation. now, the fed has wanted to seethat, this may be all the reflection that the gas pryce prices should be rising. gas prices up. people don't feel good about their prospects and see more inflation in the numbers but these don't always transfer to
what happens in the stores. alan greenspan once famously said we watch what they do not what they say. >> stocks took a nose dive. the s&p 1%. erik: they had already dipped negative before the number came out but now they have taken a leg lower. they are not down by a lot. we are still in record territory but red as opposed to green. >> we started in positive territory after the again disappointing data on production. factory output falling for the fifth month straight yet at the open stocks got a boost. erik: i was around when the industrial production data came out. there was a restrigs to the previous month by the same 0.3% difference, so it kind of evens out. >> thanks, erik, for keeping me honest. erik: i mean, it's down a
little bit. it's note worthy, because michael was talking about the pick-up expectations and if people have read that far into the report maybe they feel differently about the 10 and 30-year treasuries. but not right now. >> a question we will find out bob dole, erik: right now let's have a look at what's making news, amtrak service may soon be fully restored. the last two mangled cars are now off the tracks and track and power line repairs are on the way and they expect limited service to resume monday and full service to resume wednesday. no official cause has been cited for the accident although we do know the train was going much faster than it should have been. in nepal a pal --
three bodies were found near a crash. it's unlikely anybody survived. the helicopter was carrying six marines and two nepalese soldiers. at least one of those marines was shown delivering food and quake supplies to victims. report that the militant group putting out a praising eir leader those who carry attacks out on western nations. there were reports he was seriously wounded and said to have given up day-to-day control over the islamic state. >> and jurors must decide now whether joe cars nigha gets the death penalty or life in rison.
and george step nop license is snagged in something about his old boss. not grilled for reporting his 75,000 donation to the clinton administration. stephanopoulos has decided not to moderate a debate next summer. and in what appears to have been a fake takeover bid for avon, a firm made an electronic filing offering to buy avon that was almost three times the asking price and avon said it hadn't received the offer and no one could confirm pte capital even existed. now an investigation is under way to find out if it was an attempt to tamper with the market.
erik: and the 73-year-old man has been hospitalized after suffering a heart attacked and lee succeeds his father in the samsung foundation. >> and here's a relief. has anine chaos down under ended after johnny depp and his ife are flying down and they say the couple did not declare the dogs when they flew into into and when they flew ustralia on a private jet. australia does it to prevent disease. erik: and myanmar, one of the irst companies to set up shop.
>> and president obama spent yesterday at camp david with top leaders from the middle east. we will get reaction from president bill clinton's one-time national security advisor at 10:30 eastern. erik: and happy craft beer week. it's being celebrate bid almost 20% more than two years ago. we are looking at america's changing taste in suds. >> and i want to go out to julie hyman in the newsroom. what are you seeing? julie: a lift announcing carl icahn has raiseds money. $enterprises, car icon's company as well as part of that, one of icahn's directing managers says i believe ride sharing is poised to become a fundamental component of our transportation infrastructure so invested $1 million getting into the ride sharing business
through lift. >> thank you julie. carl icahn taking a bid on lift the oober competition. two days after we got equally poor retail sales data. bob dole is the equity strategist joining us from his offices in new jersey and rich with bloomberg intelligence, bob, let's start with you. weak retail sales numbers and again weak consumer confidence. is the september rate hike now off the table? bob: i don't think so. look, the fed is looking for a little bit more inflation and are getting that in the costin decks. you mentioned the consumer sentiment toward inflation picking up some. the employment rate is down in the region that would make them comfortable. i would feel differently if their starting point wasn't can
a anytime. while the economy is not boyn't, it's not where it was. erik: and consumer confidence not like this in a while. what does that suggest? >> it suggests economists have been missing these numbers for months now. as a matter of fact, the bloomberg economic index is at its lowest since 2009. rich: a little too much optimism. admitedly i'm bearish on the economy. and you're an economist. rich: yes, bob and i shared the stage a bit ago, and i still -- i'm still negative on it. erik: why is that happening? investors complain, particularly in fixed income that it's so hard to invest and others are in the market making
distorting prices. is it similarly difficult for economists to figure out this because we are on unchartered territory? rich: yes, i don't think we've ever seen a chinese deceleration pore what we are told, anyway. >> probably declerting but to what extent? we do not know yet. rich: look, you don't need to be an economist to know this is not going to end well. if you see a 500-pound man on the street corner smoking a cigarette and eating a box of doughnuts, do you need to be a doctor to say, wow, that's not going to end well? no. to pinprick the bubble -- erik: you said it. i didn't. >> bob, do you agree with that?
are we going to see another teverer tantrum? bob: i wouldn't be surprised. we have nominal growth, real plus inflation and running 4%. that's not consistent with a 10-year treasury at 2. so my guess is the whole infrastructure rate has to move up to more acceptable levels, and that could cause some people in the bond market to get scared for a minute or two and that would not be good for stocks. stocks being at an all-time high is amazing given all we have talked about. erik: so how sit, 21.18, the dow is at 18,229 yet you and some other people, rich included expect things are going to have to change and perhaps sooner than later. bob: well, it's a goldie locks economy. the bears and bulls are
frustrated with the economy and we are muddling along. this week we got some not so good numbers and next week we will probably get some good numbers. the unemployment numbers indicate the economy is making modest forward progress. that's a beautiful thing. >> what do you think was the key driver of the bond selloff and why do you think it's sort f abating right now? bob: my view is as long as the german bund was selling at that yield, nothing was going to happen until that move. now, i think the deflation narrow numbers in europe got over done. as it looks like they will not go into a big, black hole, somebody woke up and said, you know, i don't think zero makes sense and they quickly moved it up to 70 basis points providing a framework for the entire
infrastructure to the to move up so. rates are still low. they are just up from unbelievably low. >> our thanks to bob doll joining us from his offices in new jersey. erik: coming up, an offer to buy avon that appears to be fake and sent company shares on a wild ride and of course shows just how easy it can be to fool investors, even with an s.e.c. filing. ♪
the company courting people familiar with the matter, other possible partners as it seeks $5.9 into china and its billion online video market. the maker of candy crush says it will not return to growth until later in this year. the company's profits were unchanged last year although both did beatest mats. -- j.p. p. surma organ said a probability versus a possibility. shares up at yum! sln up 1%. erik: russia's economy had its first decline in almost six years. better than all forecasts in a
bloomberg survey of analysts. stalled last year after the u.s. and europe imposed sanctions over the fighting in the ukraine and the ruble plunged. olivia: and u.s. prosecutors will not seek a guilty plea. barclays fine may be around $50 million having to do with the manipulating of an industry. erik: and a boxing ring. former presidential candidate is taking on evander holyfield at a charity event. e two are raising money to needing vision help round the world.
olivia: we took a look at the bloomberg's most read stories the third story about yesterday's takeover offer for cosmetics company avon or we should say takeover target. because it appears it was a hoax and shows just how easily investors and the s.e.c. can be fooled. rik, this was bananas. first is stock shot up 20% after $20 a share, three times where the stock was trading. i thought it was a typo and it was t.p.g. and who knows why he the cosmetics company so much. erik: it took only a cursory reading that have the showed th couldn't get their own name out
right. if you run a bot and your computer buys because it sees offer, bid, acquisition and automatically hits the buy signal or if you're a momentum trader that jumps on the train, and you lost money -- olivia: i have no sympathy for you if you're a -- trader and that's how you get your tips. erik: put there's a difference between electronic trading and programmed trading. if computers are programmed to trade like that, yes, of course there's something wrong with the s.e.c. if anybody can dump in a filing that is patently untrue. yes, that seriously needs to be fixed. but you're supposed to invest on the basis of fact and belief. olivia: true. i'm not arguing with that. but a lot of people are betting on algorithms.
erik: for almost 50 years this was off-limits to the west. like cuba, myanmar was a closed economy. now the country once known as burma is opening up. >> just imagine the billions of dollars to get energy and to get roads and infrastructure. that, by default is a tremendous opportunity. erik: it's been only three years since the u.s. lifted sanctions. hilton moved fast. already there's a 200-room hilton in the luxury city. pitaw and now -- >> also from a ledger perspective. erik: for decades, this is what the world knew of burma. a brutal repreparation under a
military dictator. now tourism is taking off, growing by more than 400% in 10 years. the rest of the world is starting to discover myanmar's breath taking beauty and rich history and of course -- the food. >> look at the size and color of that. they are naturally very sweet in flavor. why do people come to burma? that's why. erik: what's missing in myanmar are first-world standards. after so many years of isolation the economy can barely meet the needs of companies like hilton. >> trying to make this from scratch, quite a challenge finding the numbers and getting supplies to the hotels. a lot of logistics challenges. erik: myanmar wants to more
than double the tourism rates in the next 10 years. their partner is a construction tycoon a united states official once called an up and coming croney. chit khaing. >> a lot of robust due diligence is done before choosing partners, and so far, so good. profits may 's quadruple. you can see the farmer's field in the last decade but the city has less than a million inhabitants judging by the desserted 20-lane highways, hilton may have to wait for years to earn a return on its nvestment.
olivia: erik, so cool. i love that image of you standing in the middle of a 20-lane highway. erik: it's an economic battleway. there's a big chinese presence. hilton shares a border with china and as they do in africa badly want to get into a market not exploited already by the west. olivia: are people there more looking forward to being inhabited by the chinese or west? erik: they are still transitioning to democracy. i'm on my way. have a great weekend olivia. see you folks on monday. ♪
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ambassador for unique american art form, the blues. last night died at his home in las vegas. he was 89 years old. king grew up in poverty on a mississippi cotton plantation and became one of the most influential guitarists and ring jimmy hendricks the thrill is gone. a refugee crisis is growing in southeast asia. more than 1,000 migrants came ashore most muslims from yanmar denied citizenship. thousands of migrants are currently believed to be stranded on ships waiting for a country to take them in.
and the senate has advanced a bill that would give them authority to speed up a bill. they backed off once republicans agreed to allow votes on bills designed to advance american jobs. and even though its owner is famously fond of carbonated drinks, dairy queen drops sodas rom kids' meals. those were your top stories at this hour. -- as of the he end of last quarter we found out what barry rosin design is betting on. julie hyman is in the newsroom with the headlines. julie: hi olivia. wanted to give you examples in which he is taking stakes.
one is brook detail. as the filing came out and the filings will be coming out throughout the day. also star wood hotels. you can see brook detail taking a stake in pinnacle foods. stake in has a 4.2% there and cooperman's omega humana is a company where he is taking a stake. as always, olivia, when we talk about these we have to give a couple of caveats. what were the holdings as of that single day? at the end of the quarter? so it is potentially a little backward-looking. nevertheless people still try whether he algorithm
they are really people or the computers programmed. olivia: still to come on "bloomberg market day," hundreds of thousands of graduates will try to enter the market for the first time. we have advice from a top recruiter. and when a bd light isn't good enough. we're looking at the rise of craft brews in the u.s. and at is 1:30 a.m. we have the billionaire cofounder of home depot tells us if he still supports chris christie even as he still plummets in the polls. that's ken langone. and the president promised to defend allies in the region concerned about a nuclear deal with iran. >> the united states will stand by our d.c.c. partners against external attacked and will
deepen and extend the cooperation we have when it comes to the many challenges that exist in the region. olivia: the president stopped just short of offering the type defense guarantee offered allies such as japan and in turn got no formal framework of a nuclear pact with iran. so was the meeting a success? joined by sandy berger the president's national security advisor and the former u.s. ambassador to bahrain. one of the countries attending the summit. sandy, let's start with you. the goal of this meeting was to get arab support for the iran nuclear deal. was the summit a success? >> i think it got over a low bar, olivia. the arabs wanted a stronger security guarantee from the united states and what they
principally wanted is more active american opposition to iran's activities in the region. they got strong language. strong language from the president. i think they tried to explain to the president clearly that their real concern is iran's behavior and they are concerned this nuclear agreement will open up a reapproachment between the united states and iran. on the u.s. side i think the united states would like support for the nuclear agreement by the gulf countries and they can get qualified support and ultimately will support it. so i think a worth wild meeting. but it certainly did not achieve a break through in any respect.
olivia: all right. perhaps a step back but ultimately the president announced he was going to have this meeting with nuclear leaders. the goal instead of saudi arabia to think they don't need to have their own nuclear deterrent. keeping in mind the king himself didn't actually come from saudi arabia, himself, that president obama was successful in convincing them that they didn't need build their own nuclear deterrent and could rely on the u.s.? >> that will depend on what kind of actions the united states takes in helping defend saudi arabia and protecting them from the threat they see coming from across the persian gulf from iran. if we are robust in our response to concerns, then i
think saudi's feeling of security as a deterrent is a success -- in turn regional conflicts. they are going to continue doing what they are doing which is take more responsibility for their security and go it alone which frankly i think the administration has been troubled by. olivia: what do you think, sandy? sandy: well, the iran deal takes off the table one piece of the threat in the region. it takes the stinger, the nuclear stinger out of iran. it does not eliminate the iran threat. iran continues to be a threat to the region in terms of its destabilizing activities in yemen, in lebanon. but still what it's doing in syria and other parts of the region. so the way the president needs
o cast is so say we've put the iran nuclear threat aside. that's now taken care of. we have not, however, lost sight of the fact that we have other concerns about syria and we intend to be with you in dealing with those stressors. this is not the beginning of a u.s.-iranian reapproachment unless iran changes. there's no evidence of that. we could hope for that. but you know, there's the iran a president errani, which is the one who and runs the revolutionary guard and helping the others in yemen. so we have to be clear that all these other disputes are more dangerous if iran has a nuclear weapon. olivia: and also that general
sulaimonny likely in charge of the provocative warning shot we keep seeing being fired at international vessels off the coast of iran. adam, one thing that was actually agreed upon and constructive was an agreement to help arab allies develop defense against bo listic missiles. that can't be going down well in tel-aviv. >> i'm not so sure about that. frankly, i think in many ways both israel and countries of the gulf share a common interest in protecting themselves against iranian missile threats, so i wouldn't necessarily assume that. two other points of why i think this summit was important. and historic. a, it's the first time the leaders of the g.c.c. meet with the united states. we have been trying to do that for five or six years. one of the big reasons it
happened this time is because the g.c.c. and the six countries of the gulf have finally patched up a lot of internal differences and can meet as a group with an american president and the second thing is what the president said about speeding up arm strengths first to the countries of the gulf. look, if you're a foreign companies ing to buy from the united states, it takes a lot of -- and i hope the administration follows through on this. olivia: thank you so much adam moreli. and sandy berger. coming up the job market this month's college grads are facing and the big difference between today and 20 years ago. ♪
olivia: welcome back to the "bloomberg market day." we are about one hour into the trading day. it's time to get you caught up on all the market action you need to know around the world. we start in europe where john is standing by. hi john. john: hello, olivia. the ftse 100 down and the dax in frankfurt down by four in five. right here at the open, stocks higher. happy friday, happy friday then consumer -- the dax down by over 1%. why does the dax care or why should it be concerned?
because dollar drops like a stone and the euro pulls a complete u-turn and goes to $1 .14. looking at 157.96 the pound against the dollar. u.s. consumer confidence moving equities, julie over to you. julie: take a look at the three major averages. they are little changed right now. perhaps would be higher if it were not for that number. although after we did see that big rally, up to a record yesterday for the s&p 500. right now financials the biggest drag on the s&p 500 down about a half a percent. limiting any gains we might otherwise see. take a look at bonds as well with the consumer confidence report. the yield on 10-year is falling at this point as we see some
buying in the treasury. and you heard jon talk about the dollar. along with those yields, the dollar is going lower and finally or not so finally lyrics i'm going to toss it back to you, olivia. olivia: thank you julie. let's take a look at where the asian markets ended the trading session. the nikkei taking its lead from u.s. stocks in the green and hang seng with an investment link between shenzhen and hong kong could be established later this year. pairing its gains for the week. it still basically doubled. overnight netflix is trying to get into china by teaming up with a business backed by alibaba. this report filed from hong kong -- >> netflix is talking with
possible partners in china as it looks toward a $9.9 billion business. of edia the founder alibaba, now the online company is expected to triple by 2018 but to take advantage of that gross, it's almost essential to have a local partnership for online content. olivia: now here are some of the top stories crossing the bloomberg terminal at this hour. oil futures are headed for their first weekly loss in a week. u.s. output remains to a -- close to a record high. output is expected to expand later this year. factory output stalled virtually unchanged for the month of april and for the
fifth straight month total production declined. manufacturers have been hit hard by the stronger dollar and automakers who increase production of cars and parts. and in horseracing the field is set for the second leg of the crown. the triple crown. no horse has won the triple crown since 1978. those were your top stories at this hour. now, it's college graduation season. hundreds of thousands of newly-minted graduates will try to enter the workforce. hiring has picked up and the economy is slowly improving but these millennials face a very different job market than their parents did and the chances of a 20-year-old finding a
full-time job his first year out with health care? not what their baby boomer parents remember. i spoke with our guest explaining some of the differences. >> i think the single most important change is they have a far greater responsibility to chart their future professionally than their parents ever dreamed of. there's not the expectation that you walk into a company and walk out with a gold watch 35-40 years later. big difference in who owns your career. olivia: yes. gone are the days you can expect to walk into general mills and walk out 40 years later. >> i think it makes sense to start your entry point in a professional business that can teach you what it means to be a professional. because most of the times you don't know what being a
professional is all about. so i'd start there. then, i think you want to have a bunch of inning throw spective moments. where is the future going? you have to have some point of view about what's going to matter in the future. then you have to have honesty about you and what are you good at? what do you like? and hopefully there's some intersection between what you like and what you're good at. then you have to accumulate skills. everyone talks about the war for talent but my view is it's a permanent campaign constantly to be figuring out how the gain the right skills and how the move fast? you have got to be agile. olivia: for recent graduates, think of yourself as a startup but i supposed they certainly are in the red the first two years. my thanks to judy -- jody
olivia: welcome back to the "bloomberg market day," i'm olivia sterns. happy friday. the end of the week. we are going to talk to you about ways you can live well, the good live on the weekend. maybe this weekend you want to grab a beer. it's friday. who doesn't want to grab a beer? this week is officially american craft beer week. the industry has grown so much in the past two years that it's worth celebrating for an entire
week. julia hertz is a craft program director at the beer association and spear heading american craft beer week. she joins me now from denver. julia, if you look at what's happening in booze broadly you can say people are drinking less beerp and more rosa and more vodka and whisky, why is craft beer bucking that trend? ulie: you've got a growing level from small and independent producers. olivia: so what's craft beer week consist of? in e: this is a celebration all 50 states. craft beer.com has the initial calendar so in denver there's things going on just like in
new york and san francisco. it just depends on which brewery is celebrating which way. you've got lots of great festivals. olivia: i am no beer expert. what do i need to know about the craft beer industry? who are the top brewers and what sets their industry apart? >> they are responsible for 65%, give or take, of sales. a few of them are selling nationally, then you have the local backyard brewer, so you just look for what's local and keep an open mind. a great way to try several small ounces at a time or sixer mixers so you get six different bottles at a time. there's a lot of different ways to get to know the varieties
going on today. ivia: who is the craft beer drinker? >> we are very strong with millennials, they identify themselves with those behind the brand and authenticity from small and independent craft brewers. olivia: how widespread is the craft beer phenomenon? i can't imagine germens suddenly turning down heineken for craft beer. >> those in belgium had to up their game and in the u.s. 75% of the legal drinking adults live within 10 miles of a brewery, so it's voor localized here in the u.s. and $100 million in exports. what's going on in the bright spot on beer, in the u.s.
the brands are starting to grow. olivia: germany has this law that protects beer purity limiting the depreents breweries can use. do we have a law in the u.s. that we can thank for u.s. dominance of craft beer? >> we can thank no law inhibiting creativity in the u.s. so that's why we saw the same thing happening with the cheeses and coffees and chocolates they said we are going to be innovative and amp these beer styles up. olivia: thank you. julia herz for joining us. still more to come after this break.
raising the stakes in this rivalry with industry leader, uber. olivia: he has been one of chris christie's big backers, but has he given up on the new jersey governor? pimm: russia has hired some of the city's top lobbyist to take on capitol hill and the white house. ♪ olivia: good morning. i'm olivia sterns. welcome to the bloomberg market day. pimm: we are 90 minutes into the trading day, let's get a look at the markets right now. , stocksok at the us not moving very much. nasdaq down.